TAX COMPLIANCE

BIA PRESENTATION10/11/2010 1

BURS Mandate

• Administer and enforce the revenue laws;– Income Tax Act– Capital Transfer Tax– VAT Act– Customs & Excise Duty Act

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TAX COMPLIANCE

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What is Tax Compliance

Simple definition • Is the degree to which taxpayer comply with the

tax law and administration• It is measured in terms of the “tax gap”• It can also be defined as seeking to pay the

right amount of tax (not more) in the right place and time as compared to tax avoidance.

• The aim being to have a 100% compliance with Revenue laws 4

Tax Compliance • Tax compliance include;

– Voluntary compliance– Compliance by enforcement

• Voluntary compliance is adherence to the tax legislation without the use of forced measure within the laws

• Forced compliance is whereby taxpayers comply after some enforcement measure of the law has been implied

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Legal Framework• Tax revenue laws assumes voluntary compliance;

– Sec 65 of the Income Tax Act; Every person shall furnish a return….

– Sec. 26 of the VAT Act; Every registered person shall furnish a return…

• According to the Act a person has to declare his or her income or VAT to the CG

• VAT, company / Corporate tax is based on a self assessment system which encourages voluntary compliance 6

Legal FrameworkEnforcement• The law stipulates enforcement measures to deal

with taxpayers who do not voluntary adhere to the laws– Sending reminders– Penalties ;Sec. 117 & 118 IT and Sec. 33 – Interests; Sec. 97&101 IT and VAT Act, Fifth

Schedule.– Garnishee order, (ITC 9); VAT sec.40, IT sec.109

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Legal Framework Cont…– Seizures; Sec. 37 VAT– Closure of Business Premises

(Sec 63 VAT)– Levy of distress; Sec38, VAT– Summons (14 days)– A writ of executions; sec. 34 VAT and

sec.103 IT– Criminal Proceedings 8

Burs InitiativesBurs has created an enabling environment for tax payment

which reduces the burden of tax compliance by the following tax administration activities;

• Sending of returns• Sending of statements – debt• Payments Plans• Taxpayer segmentation-Large taxpayer unit• Burs accessibility

– Opening of offices– Service Centres

• Computer Auditing9

Burs Initiatives• To encourage voluntary compliance

– Taxpayer education and awareness

• To enforce compliance– Surveys– Inspections– Block management

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TAXPAYERS RIGHTS• Right to object and appeal an assessment

– Appeal can be made to:* Board of adjudicators* High Court

• Right to secrecy • Right to appeal against seizures and detentions

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WHERE YOU CAN FIND BURSADDRESS & LOCATION• Gaborone P/Bag 0013• Francistown P/Bag 38• Lobatse PO Box 263• Jwaneng PO Box 5• S/Phikwe PO Box 129• Mahalapye PO Box 240• Palapye PO Box 97• Maun PO Box 219• Ghanzi P/Bag 0018

TELEPHONE NUMBERS

363 8000/363 900024136355330566588069526136994710486492038868613216596463

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THANK YOU

Collecting Taxes for Collecting Taxes for Botswana's DevelopmentBotswana's Development

www.burs.org.bw